This is a SEC-registered Investment Company which purchases a fixed, unmanaged portfolio of income-producing securities and then sells shares in the trust to investors. A unit trust is a vehicle for collective investment, constituted under a trust deed. Quite similar to mutual funds, the major difference between a unit trust and a mutual fund is that a mutual fund is actively managed, while a unit investment trust is not managed at all. As an open-ended investment fund, the number of units rises and falls as investors buy and sell units, this way, there is no supply or demand created for units and they remain a direct reflection of the underlying assets. The beneficiaries (called unit holders or shareholders) of a unit trust each possess a certain share (called units) and receive payments according to the number of units they possess. Capital gains, interest and dividend payments from the trust are passed on to shareholders at regular periods. Unit trusts typically incur lower annual operating expenses (since they are not buying and selling shares) than mutual funds; however, unit trusts often have sales charges and entrance/exit fees.
Due to their open-ended status, they are not listed and tradable on The Exchange.